You do have to hand it to Buffett

[gfresh]

Was just thinking on this earlier.. Warren Buffett / Hathaway bought in $5bn worth of warrants @ $115 in late September for Goldman Sachs. At the time the markets were imploding. Everybody was saying how crazy that was.

I remember reading in here why some were writing off his "stupid" investment at the time, and indeed he didn't pick the bottom as you can see from the chart.

However in the end, I think $1.74bn (and running I assume) is not a bad profit in 10 months is not too bad. Current price = $155

I can see why he has got into his position today as being the most successful investor in the world.. Amazing!

 

[Ageo]

Does anyone here ever follow in his footsteps in terms of investing?

 

[skyQuake]

Was just thinking on this earlier.. Warren Buffett / Hathaway bought in $5bn worth of warrants @ $115 in late September for Goldman Sachs. At the time the markets were imploding. Everybody was saying how crazy that was.

I remember reading in here why some were writing off his "stupid" investment at the time, and indeed he didn't pick the bottom as you can see from the chart.

However in the end, I think $1.74bn (and running I assume) is not a bad profit in 10 months is not too bad. Current price = $155

I can see why he has got into his position today as being the most successful investor in the world.. Amazing!

R:R is pretty crap? Went pretty far offside..

 

[ThingyMajiggy]

R:R is pretty crap? Went pretty far offside..

Yeah thats what I was thinking...down $60 before it goes up $40...gotta hand it to him for holding through that!

 

[skyQuake]

Yeah thats what I was thinking...down $60 before it goes up $40...gotta hand it to him for holding through that!

I suppose hes large enough to keep averaging till theres no more stock left

Big stack! He's calling station :

 

[gfresh]

True, but the thing is he is has come up well ahead in the end, which is the main message. And he has done it time and time again, even when people have been happy to write him off for loses taken short-term. It's impressive to me anyhow

I'm sure he would have had plenty of good inside knowledge though, before signing away $5bn as well.

 

[awg]

wonder if he wishes he had doubled up at $60!

some of the large Sovereign Funds like Singapore, also bought into some of the US banks at a low, not sure about GS.

As alluded to by other posters on other threads, Buffet and others dont trade using conventional stop losses

 

[mazzatelli1000]

As alluded to by other posters on other threads, Buffet and others dont trade using conventional stop losses

If I had inside info, I wouldn't use stop losses either.

 

[matty2.0]

You forgot to look at GE. lol ....

 

[Agentm]

great piece in the age this morning, just a beautiful collage of words for the great goldman sachs.. in particular matt taibbi!!

Awash with dollar bills just weeks after repaying $US10 billion in government aid, Goldman is taking heat as never before.

In a lengthy piece for Rolling Stone magazine, journalist Matt Taibbi characterised the company as "the great American bubble machine", offering a roll-call of Goldman alumni in powerful government positions and blaming the bank for every financial bubble since the Great Depression.

"The world's most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money," writes Taibbi.



http://business.theage.com.au/business/goldman-sachs-earnings-a-warning-flare-20090715-dlk3.html


its a great read.. and i keep smiling each time i think about it.,,

 

[cheeyeen]

The 5 Billion investing is in the preference shares of GS which pays him 10% of interest when the cash rate there is near 0. And the warrants to buy 5B worth of GS shares at 115USD is just a "sweetener" thrown in by Goldman Sachs. His bet is just GS won't go bankrupt. He is not losing money when the warrant is out of money. No need to cut loss or average down..

 

[alphaman]

However in the end, I think $1.74bn (and running I assume) is not a bad profit in 10 months is not too bad.

So what would you say if GS tanks below $100 next month?

To be honest, Buffett most likely would not appreciate your praise. You are judging his performance based on a timeframe of 10 months, which is meaningless for him.

In the GS deal (and GE), he bought preference shares that give him 10% dividends. He got the warrants for free. I would have accepted the deal without a blink. The only difference is GS did not want my stamp of support.